03. 09. 2025
AUTHOR: Aymeric Kouam
As the European Union (EU) Energy Ministers gather in Denmark on 4-5 September, they face a pivotal decision: Should they reinforce dependence on imported and volatile fossil fuels or build an economy on homegrown electrification and clean energy?
Recent years have highlighted the fragility of the EU’s energy system and the need to redefine its architecture to ensure energy security and affordability in a changing geopolitical context. In this new phase of its energy policy, the EU can focus on doubling down on electrification and accelerating the rollout of renewables and clean technologies. This will advance European energy independence, the net-zero transition and economic competitiveness alike.
Electrification: A key pillar of the EU’s energy security
Electrifying transport, heating, and industry with clean electricity is one of the most efficient ways to reach net-zero by 2050 in the EU, while creating space for industrial innovation and new technologies. It also reduces the EU’s exposure to energy price shocks and geopolitical pressure. More clean electrification means less dependence on imported fossil fuels and more resilience for European citizens and businesses.
In 2023, about 23% of the EU’s final energy use was electrified, a share that has remained flat over the past 5 years, while countries like China have moved fast ahead. As the EU decarbonises, 50% of its economy can be electrified by 2040, in line with a 90% climate target. Electrification paired with rapid renewable deployment can strengthen energy security, reduce costs, and support business cases for various clean technologies.
A clear set of priorities for the future of the EU energy strategy
Ministers can clearly state the necessity to make electrification the pillar of the EU’s energy system. It’s about time the European Commission takes concrete steps and assesses the need for legislative measures to act on the mandate given by leaders in the Strategic Agenda. The EU can consider five key priorities:
Expand and modernise energy infrastructure
Upgrading and expanding electricity grids is essential to connect additional renewable capacity and ensure a stable and flexible supply. Cross-border interconnectors, storage, and smart grids will also be key to complete energy system integration at the EU level. Greater use of grid-enhancing technologies and flexible system use could save up to 35% in conventional grid expansion costs. The upcoming “Grids Package” by the European Commission is essential to set out a concrete timeline and measures to achieve this, and also to have more comparable energy prices across the EU.
Accelerate renewable energy development
National governments can build on recent progress by streamlining and accelerating permitting, supporting clean technology innovation and investing in additional capacity generation and storage solutions. This is a competitiveness strategy. The main challenge for the EU’s industrial competitiveness is the price of energy, which is relatively high because of the bloc’s reliance on imported fossil fuels. Deploying more homegrown renewable energy and investments in solar, wind and storage can shield European consumers from fossil fuel market volatility. Ministers can clearly point out the centrality of renewables and low-carbon sources in the 2040 energy framework.
Ensure energy affordability for households and businesses
In the short term, supporting households and businesses with well-targeted policies and social protections will be essential. Better grid flexibility and integration will lower the energy system costs, therefore reducing the network charges component of energy bills. In addition, achieving a full Energy Union and an integrated energy market will protect the most vulnerable EU citizens. These policies can ensure that electricity remains the clean and cost-effective carrier of the EU’s energy future.
Create an enabling environment for electrification
Clear regulation and access to clean electricity can be the foundation of the EU’s energy strategy. From heat pumps to electric vehicles to industrial electrification, strong policy incentives and consistency are essential to drive the markets and keep up the race with China. It starts with Member States properly implementing existing reforms, like the electricity market reform, permitting framework, and decoupling electricity from gas prices with long-term contracts such as commercial Power Purchase Agreements (PPAs). In addition, the upcoming Electrification Action Plan can provide guidance to boost the uptake of heat pumps, electric vehicles, and industrial electrification.
Mobilise enough investment
Significant investments are required to meet Europe’s electrification goals. Funds like the Innovation Fund, Connecting Europe Facility for Energy and Competitiveness Fund can prioritise direct electrification, and it is essential that these priorities are still integrated across all programmes, as the Multiannual Financial Framework (2028-2034) gets adopted. Public and private finance will also be vital to scale up manufacturing of key technologies and services, supporting the electrification of industrial processes, transport and buildings. At the same time, locking into new long-term fossil fuel contracts, like the recent $750 billion energy trade deal with the United States, risks slowing progress.
Tomorrow’s Council meeting offers ministers an opportunity to make clean electrification the centre of Europe’s energy future. This approach strengthens energy and economic security while supporting decarbonisation goals. By prioritising electrification, the EU can lead on technologies and infrastructure that are fit for the future: batteries, electric vehicles, industrial heat pumps, and smart grids.
Photo: From left to right: Sophie HERMANS (Minister for Climate Policy and Green Growth, Second Deputy Prime Minister, Netherlands), Lars AAGAARD (Minister for Climate, Energy and Utilities, Denmark)
Copyright: European Union
